Photo/IllutrationThe proposed site for a new nuclear power plant being planned by Horizon Nuclear Power Ltd., a subsidiary of Hitachi Ltd., on the island of Anglesey in Wales (Asahi Shimbun file photo)

The Abe administration's last hope of nuclear plant technology exports being a pillar of economic growth appears to be at a crossroads, and the signs are not good.

Hitachi Ltd.'s disclosure that it may have to ditch plans to build a nuclear reactor in Wales appears to throw a fatal wrench in the works.

Hiroaki Nakanishi, chairman of Hitachi, told reporters Dec. 17 that his company could proceed no further with the project on the island of Anglesey, citing ballooning costs.

Asked about the apparently bleak future for such exports, Chief Cabinet Secretary Yoshihide Suga put on a brave face at a news conference held the same day.

He noted that a number of nations had expressed strong interest in Japan's nuclear energy technology, adding, "We will fulfill our responsibility in dealing with the issue of climate change as well as the peaceful use of nuclear energy in the world."

Nakanishi told reporters that Hitachi was finding it increasingly difficult to raise the necessary funds for the costly project.

The admission comes after reports earlier this month that Mitsubishi Heavy Industries Ltd. was leaning toward abandoning plans to construct a nuclear plant in Turkey.

Hitachi moved into nuclear plant business overseas in 2012 when Nakanishi was Hitachi president and through the acquisition of Horizon Nuclear Power Ltd., a British nuclear power plant operator.

But with increasingly stiffer safety standards globally, the expected cost of the project to construct two reactors on Anglesey swelled to 3 trillion yen ($26.5 billion).

Under a deal reached by Hitachi in June, the governments of Japan and Britain agreed to support the lion's share of financing.

Under the plan, Hitachi would contribute 300 billion yen, and the same sum would be raised by other Japanese and British companies, respectively. In addition, the British government would guarantee loans of about 2 trillion yen.

The costs of the project were to be recovered through the electricity generated and sold after construction was completed.

However, Hitachi encountered difficulties raising the 300 billion yen from other Japanese entities, including electric power companies and government-affiliated financial institutions.

It had also sought to hold talks with the British government to gain a guarantee that the electricity generated would be purchased at a high price so as to recover project costs more quickly.

But the British government has other more pressing issues to deal with, most notably its departure from the European Union. Thus, negotiations with Hitachi did not materialize.

With the uncertainty over the economic effects of Brexit, British officials are also reluctant to make any decisions that would lead to greater financial burden on the public through higher electric bills, as well as increased British investment in the Hitachi project.

Hitachi has already made clear that it would decide on a course for the British project next year. But with sources saying a growing number of board members have criticized the plan, it remains doubtful if Hitachi can move ahead with the construction project.

The Abe administration had placed its hopes on nuclear technology exports as one way to maintain the know-how and personnel in the field at Japanese companies.

That move was forced by the lack of any plans to construct new nuclear plants in Japan in the aftermath of the 2011 triple meltdown at the Fukushima No. 1 nuclear power plant and concerns about nuclear plant safety.